It’s no secret the travel category has been a laggard in recovering from last year’s pandemic-induced ad recession.
And while the pandemic still rages in different parts of the country and the world, Zenith has a new travel ad spend forecast that predicts a huge growth spurt in the category. It expects the category will accelerate from 24% growth this year to 36% in 2022.
The category is in catch-up mode, and Zenith sees it growing two to six times faster than the ad market as a whole from 2021 to 2023. Even so, the travel ad market won’t return to pre-pandemic levels of spending until 2023.
According to the report, travel brands will increase their spending on digital advertising from 63% of budgets in 2020 to 70% in 2023.
Given all the sheltering in place and lockdowns imposed during the pandemic, the travel category was hit harder than most, losing nearly half (46%) its value in 2020 and falling to $9.7 billion. The ad market as a whole shrank by just 4% last year, according to Zenith’s assessment.
Pent-up demand will drive outsized growth going forward, but Zenith asserts that brands will have to rebuild relationships with customers as the COVID crises ebbs and new protocols are put in place in the post-pandemic era.
According to the agency, brands will have to refocus on different audiences as they adapt to the decline in business travel and pivot to growing demand for “low carbon journeys.”
The Zenith report predicts travel ad spend will be 13% higher in the U.S. by 2023 than in 2019, in part due to rapidly rising media prices. Travel spend in print is falling as circulations continue to shrink. Although out-of-home is forecast to recover and grow at an average rate of 6% a year between 2019 and 2023. That said, as travel recovers belatedly from the big 2020 slump, its overall growth will remain behind the market as a whole.
The full Zenith travel report can be accessed here.